Property Disclosures So many people are talking about property condition and what they have to disclose when they list their homes for sale. Hopefully this article will point you in the right direction.
Long gone are the days of “buyer beware” ! We have the most litigious society in our history–so welcome to the era of “seller beware”! Most states have regulations requiring a seller to notify a buyer of the known condition of the property and any known defects. Failure to do so could result in a devastating civil lawsuit! Most states have forms for you to provide the buyer detailing this information. I will provide you a list outlining most of the required disclosures; however, you need to find out what your state requirements are. You can do this by asking a local REALTOR, an attorney, state real estate board or title company representative. While your state may be absent of regulations regarding disclosure, you might consider it a moral obligation rather than a legal obligation to disclose certain property traits.
Expect to disclose the following: What items the property has (and whether or not they convey) like: range, dishwasher, washer/dryer hookups, oven, trash compactor, window screens, microwave, gutters, alarm system, satellite system, intercom/stereo system, ceiling fans, cable television wiring, television antennae, window air condition units, central air and heat, attic fans, plumbing system, septic system, public water and sewer system, fence, patio and decks, swimming pool, hot tub, yard sprinklers, fireplace, garage, garage door openers, water heater, etc… See your local requirements to add and delete from this listing.
Do these items work properly? If any of these items do not function as they are intended you will need to let the buyer know. If an item is not functioning as it is intended, do you plan on fixing or replacing it?
What about the roof? You need to have atleast a basic knowledge of the type, condition and age of your roof. If you have had a roof put on during your ownership try to find the records. If the roof is under warranty find out if the warranty is transferable to the new owner. Have you had repairs made? Did they come with a warranty?
Knowing the type and age of your existing roof will help the buyer calculate the life span of that particular roof and make allowances for repairs.
What about walls, ceilings and doors? Do you have holes in walls or stains on your ceiling? How about doors that don’t hang right? If you’re not planning on fixing them (which we will talk about later) you better disclose them. If you are planning on
fixing them–do it now, before showing your property. Do not hide defects from a prospect. (Please note that I am not suggesting you paint over the ceiling stain to hide the roof leak. I am suggesting you find the cause for the stain, repair it, and then repair the damage it caused.)
Are there termites in your house? Termites and other wood destroying insects are very common in the South. Newer homes even have pest-control systems built-in to help deter them. If you have had previous treatment or are under a termite contract have the certificate ready for review. While termites are the most common, other wood destroying insects must be disclosed if prevalent in your home. It’s a good idea to check with a local pest control specialist if you have concerns. If you know of existing problems I would suggest that it is money well spent to have treatment done immediately. The longer you wait the more costly the treatment will be and the more serious the damage. Treatment and the expense of it are inevitable–so get a grip on the problem at the earliest possible interval.
Any fires or flooding? Yep, you need to disclose it. Chances are you have left no evidence of previous fires or flooding, repairing all the damage, however, you need to let a prospective buyer be made aware of this anyway. Remember–it’s always better to be up front about these details. I assure you these secrets will not remain secret forever. At the first remodeling project evidence of such will come forth.
Is there a mandatory membership in an association? Many of the newer subdivisions have associations that pay for upkeep to the entrance, common areas, security lighting and such. If you have a mandatory membership in a homeowner’s association have the dues amount available and be aware of any special assessments or requirements.
Have you received a notice of deed violation or ordinance violation? If you have received any notices from authorities that something on your property is not in compliance with their restrictions or easements you need to let the buyer be made aware of.
Are there lawsuits affecting the property? If you are involved in any type of lawsuit that directly affects the property disclose it to the buyer. Also be sure to discuss your current listing situation with your attorney.